Study On Effect Of The Behavior Of Changing The Investment Project On Investment Efficiency In The Listed Companies

Through IPO, allotment of shares and additional issue the listed companies have raised a lot of money in the stock market. The listed companies should invest their raised funds on the projects according to the commitment of prospectus. Nevertheless, in recent years, the behavior of changing the investment projects is common, the listed companies put the raised funds in investing all the aspects. The behavior of changing the investment projects displays the malicious misappropriating motivation. On the hand, the behavior of changing the investment project may have related with the market economy system and the regulation of the securities markets, due to the defect of financial system and securities regulation, the listed companies arise attaching importance to financing, despising return; paying attention to invest, despising the main business; on the other hand, it also has the business with investment decisions. Scientific investment decisions can offer protection for the increasing development and the rapid of future cash flow. Investment decisions have great influence to the business risks and earning level of companies as well as evaluation that the capital market produces to business performance and development prospect. They are the starting point of financial decision, and they play a decision effect in the allocation efficiency of social resource.In an increasingly complex and unpredictable market environment, policymakers can’ t accurately forecast the future opportunity costs and benefits and so on. The Projects that the companies invest may have all sorts of consequences, it may lead to enormous losses and may be also excess returns. The behavior of changing the investment projects itself is an investment decision in the process of operating, the rationality will directly influence the efficiency of the capital allocation. To some extent, the efficiency affects the intrinsic value of the companies, which has a significant impact to the survival development of companies. Meanwhile, because our market is keen to hype, investors also prefer short-term trading generally. They don’t care enough to long-term strategic development plan of the listed companies and the actual investment management level. In this case, it causes the companies not to concentrate on investing the main business. In order to pander to the predilection of the market, some companies arise to alter the behavior of changing the investment projects at will, or disregard the actual situation to make large investments, but put no enough capital on the main business that should be development, the dislocation of resource allocation also affect the investment efficiency of the corporations.Based on related theories and system analysis, the paper primarily employs methods of normative analysis and empirical testing, which uses Richardson’s model to measure the inefficiency investment. First of all, based on the domestic and foreign study about the behavior of changing the investment projects and investment efficiency, it uses normative analysis to explain their current situation, and find the link of them. Secondly, according to institutional background and related theory analysis, the paper analysis how the behavior of changing the investment projects influence investment efficiency and compare the investment efficiency of the main business and noncore business. At last, it is screened the financial data of listed companies in shanghai stock exchange that have the behavior of changing the investment projects from 2007 to 2012 to study the relationship between the behavior of changing in the investment projects and investment efficiency. The results of study show the behavior of changing in the investment projects will lead to a decline in investment efficiency compared with having no the behavior of changing in the investment projects; The behavior of changing the investment projects in the main business and non-core business cause different investment efficiency.The conclusions give some practical implications. The listed companies should prudently treat the behavior of change investment projects. Even if the listed companies have the behavior of changing the investment projects, they should try their best to track with the projects that have be changed in order to avoid occurring inefficiency investment again. In addition, the wave of investment efficiency which specific directions cause is also worthy of attention, in the normal situation, the behavior of changing in the investment projects in main business can enhance the corn ability, the listed companies avoid following suit blindly to invest in non-core business.Only do this, the enterprises can improve investment efficiency to make the goal of enterprise value maximization come true.